With unseasonal rain and errant monsoon affecting production and yield in important growing belts, prices of almost all pulses, a key source of protein in the country, have increased sharply, particularly over the last month.
Prices of chana (gram), urad (black gram), tur/arhar (pigeon pea/red gram), moong (green gram) and masoor (lentil) are likely to continue high, according to industry sources.
“Any bull run comes from supply constraints, lower domestic production and output in importing countries. Weather events over the last year, from deficient to excess rainfall during harvests have caused a shortfall,” said Pravin Dongre, Chairman, India Pulses and Grains Association (IPGA).
The second advance estimate pegs domestic pulses production at 18.43 million tonnes (mt) against 19.78 mt in 2013-14 – a 7.3 per cent decline.
Output of chana, the major Rabi pulses crop, is expected to slide 12 per cent from to 8.3 mt from 9.5 mt.
Imports may rise
Myanmar, Australia and African nations such as Malawi and Tanzania which export pulses to India are also projected to producer a lower crop.
The Government on Monday said that it could consider imports through the State-owned MMTC for the first time in two years.
Imports could rise to 4.5-5 million tonnes (mt) this year from 3.65 mt in 2013-14, said Dongre, mainly yellow peas from Canada, where production is on track. Commerce Ministry data estimated imports at 3.66 mt between April and December 2014.
Retail prices soar
“It’s been a sharp price rise since the April rains. The run should continue but at a slower pace since damage assessments are still on. A production shortfall is certain since Rabi planting was 15 per cent lower than last year,” said Ashwini Bansod, Senior Analyst, Phillip Commodities.
Consumer Affairs Ministry data show the retail price for tur/arhar in the Capital are up 44 per cent at ₹108/kg as on May 8 from ₹75 at the same time a year ago. Urad (55 per cent), chana (36 per cent), masoor (36.2 per cent) and moong (5.9 per cent) have also followed the trend (see table).
“Prices will remain high this year and we have to adjust to that. Farmers have moved away from cultivating pulses due to insufficient remuneration and higher cultivation costs,” said Dongre.
Chana production has dropped by 30-40 per cent and pigeon pea by 25-30 per cent, he said.
“The Government has been watching price movements and traders will keep an eye out for measures it undertakes like imposing stock limits. Such measures have been implemented before when we’ve seen price spikes over a short time,” said Bansod.
“There’s been no hike in import duty and if the gap between domestic and imported prices increases, it could cap off the rally,” she said.
source:  BusinessLine